Introduction to Business

Question 1

Profit

Answer 1

the financial reward that comes from starting and running a business; the money that a business earns in sales (or revenue), minus expenses

Question 2

Loss

Answer 2

not every business earns a profit all the time. When a business brings in less money than it needs to cover it expenses, it is a loss

Question 3

Value

Answer 3

It is how much the customer benefits compared to what they pay. A company’s goal is to offer high value products

(e.g. you walk into a coffee shop, and they sell a cup of coffee for 5$. The coffee tastes great, it’s fresh and it gives you energy. The value is good in this case)

Question 4

Entrepreneurs

Answer 4

someone who risk time money, and other resources to start and manage a business

Question 5

What’s a business?

Answer 5

any activity that provides goods and services in an effort to earn profit (e.g. Bell, RBC, Mcdonalds, McGill University Health Centre, etc.)

Question 6

How do businesses serve functions in society and in the economy? (5)

Answer 6

→ Provide crucial goods and services (food, housing, etc)
→ Creates jobs)
→ Generate taxes for public education, transportation (by paying taxes reinvesting in business, and increasing production (e.g. a successful car company)
→ Reinvest profits in the economy, which in turn raises our standard of living and improves our quality of life
→ Creates demand for other industries, like steel or technology.

Question 7

Nonprofit organizations

Answer 7

Mission-Driven: They are primarily driven by a mission or a purpose rather than profit (focus on health, human services, education, art, religion and culture).

Still considered as a business

Question 8

What factors of production/ four fundamental elements do nonprofit organizations rely on to achieve their objectives?

Answer 8

natural resources, capital, human resources, and entrepreneurship

Question 9

What is the most important factor of production/fundamental element?

Answer 9

Entrepreneurship

Question 10

Economy

Answer 10

a financial and social system of how resources flow through society, from production to distribution, to consumption

Question 11

Economics

Answer 11

is the study of how people, businesses, and governments make choices about how to use limited resources like money, time, and materials. It looks at how these choices affect the production, distribution, and consumption of goods and services.

Question 12

What are the two categories of economics?

Answer 12

Macroeconomics and microeconomics

Question 13

Macroeconomics

Answer 13

The study of a country’s overall economic dynamics, such as the employment rate, the gross domestic product, and taxation policies.

Question 14

Microeconomics

Answer 14

More specific. Microeconomics focuses on smaller economic units such as individual consumers, families, individual businesses.

Affect day to day life: what jobs will be available for you, how much cash you’ll actually take home after taxes, or how much you can buy with that cash in any given month.